New to natural gas auditing and I'm reviewing an Atmos Energy account here in East Texas that seems to be on the wrong transportation rate schedule. The client is a mid-size manufacturing facility using about 2,800 MMBtu annually but they're on Schedule T-1 instead of T-2. The rate difference is significant - about $0.12 per MMBtu. Has anyone dealt with Atmos transportation rate classifications? Their tariff language is confusing about the qualifying thresholds.
Atmos Energy transportation rates - Schedule T-1 vs T-2 confusion
Howard, Atmos operates in our Texas territory too. The T-1/T-2 threshold is usually around 3,000 MMBtu annually, so your client might be right at the borderline. But there are also demand criteria and load factor requirements that can qualify smaller users for T-2. Check if they meet the minimum daily demand requirements - sometimes that's the determining factor rather than just annual usage.
I've worked with different gas utilities but the principle is usually the same - transportation customers often get misclassified initially and stay that way unless someone challenges it. $0.12 per MMBtu on 2,800 MMBtu is about $3,360 annually, definitely worth pursuing. Have you contacted Atmos directly about a rate review or are you planning to file a formal complaint?
Thanks Angela and Larry. I'm reviewing the load factor requirements now - that might be the key. The client has fairly steady usage year-round which should help with load factor calculations. Planning to contact Atmos first before filing anything formal. Want to make sure I understand their tariff completely before challenging the classification.
Howard, good approach to understand the tariff thoroughly first. Gas transportation rates can be tricky because they often have multiple qualifying criteria that all need to be met. In addition to usage and load factor, some utilities have minimum contract terms or interruptible vs firm service requirements. Make sure your client meets all the T-2 criteria before pushing for the rate change.
Howard, I've dealt with similar transportation rate issues with Columbia Gas here in Virginia. Randy's right about multiple criteria. Also check if there are any seasonal minimum requirements or ratchet demands that might affect eligibility. Some utilities require customers to maintain minimum winter usage levels to qualify for better transportation rates. The annual savings you calculated could be conservative if there are demand charge differences too.